Reinhard confides in Hildegard that his memories of Kircheis motivated him towards ceasefire talks. Yang discusses the situation with his staff. The death of Fischer basically cut off the legs from Yang's fleet. Yang decides to accept the ceasefire talks. Yang leaves Iserlohn with minimal military personnel and the politicians from El Facil. Fork's ship finds Yang's ship en route to the Imperial fleet. Behind Fork two Imperial destroyers fire on Fork, killing him. Back on Iserlohn, the crew receives word of an assassination attempt by Fork. The Imperial ships requests a meeting with Yang. The crew behind the ships are in reality Earth Cultists in disguise. Patrichev and many others are killed defending Yang. Schenkopp with his Rosen Ritter arrive on Yang's ship. Yang is shot in the leg.

Yang boards the Brunhilde and meets with Reinhard. Yang declines an offer by Reinhard to the position of Imperial Fleet Admiral, instead preferring to retire to a quiet life. Reinhard and Yang discuss government and philosophy. The treaty of Barlat is announced, formally ending hostilities. The concessions within the treaty increase civil unrest, public anger turns from the Empire to former Chairman Trüniht. Admiral Lennenkanpt is appointed Imperial consul of Heinessen. Julian, Mashengo, and Boris Konev prepare to visit Earth. June 20, 799 S.C. / 490 I.C.: The regent of the young Empress signs a declaration abdicating the throne to Reinhard. Beginning of the New Empire; year 1 of the New Imperial Calendar (N.I.C.).

Julian finds Yang's body. The Yang staff return to Iserlohn. The crew of Iserlohn enter mourning. Julian tells Frederica about Yang's death. It is decided by Yang's remaining staff that Frederica will assume the role of political leader. Julian is considered to be the next military leader. Julian accepts the role of military leadership after talking with Frederica. Unrest within Iserlohn grows and there is talk of desertion. Admiral Murai speaks with Julian and gives him his resignation. Murai intends to fulfill his last task for Yang by taking all dissidents from Iserlohn with him as a desertion leader. The remaining leaders of El Facil abandon the Yang fleet.

The legend ends, and history begins.

The Rosenritter soldiers latch on to Flagship Brunhilde. The Imperial doctors reveal to the admirals that Reinhard has an unknown and incurable disease. General Schenkopp holds off the Royal guard with his soldiers. Reinhard prepares to meet with Julian, should Julian make it to his room. Bittenfeld frustrated with inactivity, rushes into the Merkatz fleet. Admiral Merkatz is killed in battle. Mashengo dies protecting Julian from gunfire. Schenkopp is fatally wounded in battle while Poplan fights off Reinhard's Imperial guard. Julian reaches Reinhard's room for negotiations. A truce is announced.

Ansbach misses; Oberstein protects Reinhard with his body while Kircheis grabs the weapons, but is killed in the process. Reinhard is devastated by his friend's death and is unable to make any decisions for several days. His admirals go back to Odin, arrest Lichtenlade for the murder attempt on Reinhard. Reinhard finally recovers and speaks to Annerose, who decides to retire to a small cottage; Reinhard feels left alone. Meanwhile, in Phezzan, Rubinsky decides to change his strategy, since the balance of power cannot be maintained: Phezzan will support the Empire. He sends Boltik as Phezzan's ambassador to Odin and replaces him with Rupert Kesselring.

Yang organizes his fleet for a blitzkrieg directly at Reinhard's flagship, the Brunhilde. Reinhard divides his fleet into multiple layers of ships, providing an rotation for each broken layer. Ivan Konev is killed in battle when his strike craft is lured into cruiser fire. Yang realizes that it has become an issue of endurance if Reinhard's fleet is continuously reforming the front line. The Alliance fleet tricks Reinhard's front line into entering an asteroid field. Reinhard is divided from his main force as that group is surrounded by Yang's fleet. Müller's fleet is the first to return, rescuing the Brunhilde and acting as a shield.

Yang announces R&R time before the final battle. Julian and Yang discuss the differing battle goals for both sides. The Alliance needs to kill Reinhard while the Empire needs to hold out long enough for reinforcements to trap the Alliance. Yang finally reciprocates Frederica's feelings and proposes marriage after the war is over. Frederica is thrilled at the idea. It is revealed that Yang felt a large amount of guilt at pursuing familial happiness with all the deaths he has caused. Both fleets engage each other cautiously; both sides suspect traps or tricks from the other.

And uprising takes place in Westerland, one of Braunschweig's territories. He decides to kill all the inhabitants by a nuclear strike. Reinhard hears about the plan and wants to send a fleet to stop it, but Oberstein thinks it's better to let it happen, record it and use this monstruous act as a propaganda tool against the high nobles. Reinhard is against it, but Oberstein's plan succeeds because he lied about the time of the strike. The images are nevertheless broadcasted in all the Empire: Reinhard becomes the hero of the commoners and, even in Geiesburg, many think its time to get rid of the high nobles. The Lippstadt Fleet makes a last sortie, but is defeated; baron Flegel is killed by his men when he wants to make a suicide attack, and his crew flees to Phezzan. Merkatz, too proud to surrender, decides to kill himself, but Bernhard von Schneider advises him to take refuge in Iserlohn. Braunschweig is forced to commit suicide by Ansbach, his chief retained, who promises to avenge him. September 797 S.C. / 488 I.C.: fall of the Geiesburg fortress and end of the Lippstadt League.

Bucock's fleet advances through the Müller fleet while being pursued and surrounded by many others. Bucock's Alliance fleet is unable to charge and kill Rienhard. Hilde advises Reinhard to offer surrender to Bucock. Instead of accepting defeat, the Alliance officers toast to friendship and democracy. Afterwards, the Imperial fleet decimates all remaining Alliance ships. The Imperial victory celebration is cut short when news of Lutz's defeat at Iserlohn is received. The situation has changed for the Imperials if the plan was coordinated. The Imperial fleet would have cut off supply lines if Phezzan fell as well. With that possibility, Reinhard could have underestimated the importance of Iserlohn. Countering the panic, Hilde points out Yang would not have sacrificed his allies for a stall. The Imperial forces thus resumes their course for Heinessen.

Mittermeyer's fleet catches up with Reuenthal's fleet as they head to Heinessen. Grillpalzer betrays Reuenthal's fleet and fires on his former allies. Reuenthal's flagship is hit by long distance artillery. Reuenthal is impaled in in the chest by a piece of metal. Reuenthal continues to order tactics as he becomes pale. Grillpalzer surrenders to Wahlen's fleet. Mecklinger discovers Terraism evidence on Uruvasi hidden by Grillpalzer. Mecklinger orders Grillpalzer arrested. Reuenthal returns to Heinessen with only 10% of his fleet remaining.

Reuenthal returns to his office and assigns all domestic political matters to Elsheimer. Trüniht is killed by Reuenthal after they both discuss their ambitions and Reinhard. Reuenthal is visited by Elfriede von Kohlrausch and her baby. Reuenthal requests that she give the his son to Mittermeyer. On November 14th, Space Calendar 800, New Imperial Year 2, Reuenthal dies at the age of 33. Mittermeyer arrives on Heinessen, but is too late to meet with his old friend. Admiral Bergengrün, who also served under Kircheis commits suicide, after hearing of Reuenthal's death. Bergengrün had lost both his commanders to underhanded political schemes. Lang confesses to all his actions and implicates Rubinsky. Rubinsky is nowhere to be found.

Schenkopp takes control of the rebel planets on behalf of the Yang fleet. The National Salvation Military Council sends commodore Bagdashu to Yang to pose as a traitor to the coup in order to kill him, but Schenkopp manages to take him away. Yang's 13th Fleet meets the 11th Fleet in the Doria star system; the 11th Fleet is destroyed because its commanders turn down Yang's proposal of surrender. After the battle, Bagdashu decides to join Yang because his victory is certain. Meanwhile, in Heinessen, a peaceful gathering against the coup is held in a stadium. When the army tries to scatter it, it turns into a riot, and thousands are killed, including Jessica Edwards.

Word of civil unrest and the assassination attempt reaches Reuenthal and he orders his subordinates to restore order and find Reinhard. Grillpalzer hides evidence of Terraists on Uruvasi. Reuenthal considers visiting Phezzan and asking for Reinhard's understanding, but he realizes he risks assassination himself from Lang. When news of Lutz's death reaches Reuenthal, Reuenthal realizes the circumstances have forced him to take on the role of traitor. Even if Reuenthal had not planned the attempt, he still failed to ensure Reinhard's safety. Reinhard decides to act with all his abilities against Reinhard. Reuenthal considers offering the remaining republicans in Iserlohn the old Alliance territory if they can blockade Imperial reinforcements from that corridor, thus preventing a two front battle for Reuenthal.

Julian answers complaints on Iserlohn. Reinhard visits many locations on Uruvasi. That evening the guards around the guest house act erratically. Lutz, Müller, and Reinhard's personal guards escape via car with a battalion of soldiers in pursuit. In the woods, the Reinhard entourage is attacked by soldiers and snipers. Eventually they meet up with the flagship Brunhilde. High Admiral Lutz stays behind to hold off the soldiers and is killed. Konev brings news of Reinhard escaping Uruvasi with only a single ship. Merkatz advises Julian on Reuenthal possible plans.

The Imperial fleets adopt a tactic of attrition via rotations. The Müller fleet, Mittermeyer's subordinates, Bittenfeld and many other Admirals rotate on the battle line. Yang's fleet, with less that 20,000 ships left fights on with no rotations in manpower. Bittenfeld's elite troops cause a fatal blow to Yang's fleet. Admiral Fischer, the one in charge of Yang's fleet maneuvers is killed in battle. Reinhard passes out from sickness. A ceasefire is announced. The Yang fleet passes out in Iserlohn.

Bittenfeld is wary of the message and takes a cautious fleet formation. Yang takes advantage of the communications jamming between both sides of the corridor and tricks Mecklinger into withdrawing to the entrance of the Imperial side. The Bittenfeld fleet is lured into the corridor by Attenborough's fleet. Fahrenheit's fleet follows Bittenfeld, planning to overwhelm the Yang with numbers. Yang uses the superior numbers of the Imperials against them, forcing the Imperials to cluster together inside the tight corridor. High Admiral Fahrenheit is killed in battle preventing the complete destruction of the two Imperial fleets.

The Imperial fleet decides to accept Bucock's challenge head on and sends most their ships to meet in the Mar-Adetta system. The Mar-Adetta has unstable solar activity, communication jamming and a corridor through an asteroid belt. The Bucock fleet hides in the large corridor. As the Imperial fleets charge in, they are greeted by unstable asteroids, artillery ship fire, and space mines. The Alliance fleet is astute and attacks from unexpected areas within and behind the belt. January 16th, 800 S.C. / 2 N.I.C.: The Imperial fleet is in the middle of an unexpectedly difficult battle.

May, 14, 796 S.C. / 487 I.C.: a fake imperial spaceship docks into Iserlohn. Walter von Schenkopp, commander of the Rosen Ritter, pretends to have important information and takes control of the center of command. The Iserlohn fleet comes back, only to be destroyed by the fortress' main weapon, the "Thor's Hammer". The fall of Iserlohn dramatically changes the strategic balance: Yang hopes it will lead to a peace treaty. Back in Heinessen, he wants to resign, but is promoted to vice-admiral instead.

Yang's fleet nears firing range of the Brunhilde, but a message from Heinessen declares a ceasefire. During the battle of Vermillion, Hildegard had convinced Mittermeyer fleet to take Heinessen. Hildegard is wary of Reuenthal's ambitions, but has Mittermeyer convince Reuenthal to join the Heinessen attack. In Hildegard's judgement, the battle of Vermillion would have concluded in Reinhard's death before the other fleets could return in time. Trüniht plans to surrender, while the other members of the Alliance government would prefer to fight and die. During the meeting, armed Earth Cult members rescue Trüniht. The surrender of the Alliance has divided Yang's staff, some preferring to ignore orders and kill Reinhard while others grudgingly accept the ceasefire. It is decided that a portion of Yang's staff will escape with Admiral Merkatz to a life of piracy.

The Imperial fleet takes a snake formation as they approach the Rantemario system. Bucock fleet is forced to attack the center of the snake formation as their only plausible tactical response. The Alliance fleet is badly damaged as the much larger Imperial fleet closes in on all sides. Bocock tries to minimize losses to the Alliance fleet by using a space current to slow down the Empire's advance and disabling enemy engines with fighters. At the last moment Yang's fleet approaches from behind, stopping the total destruction of the Alliance fleet under Bucock. The Imperial fleet reorganizes their fleet and heads for next Alliance system. Julian's destroyer joins up with the Alliance fleet at Heinessen.

Julian, Poplan, and the remaining Rosen Ritter soldiers return to Iserlohn. The setting is mixed, a truce was given but the Julian fleet lost many important members. Julian and Kate decide to officially have a dating relationship. Both the Reinhard and Julian fleets arrive on Heinessen. Rubinsky kills himself in the hospital, setting off multiple bombs under Heinessenpolis tied to his brain waves. Reinhard and Julian discuss the next steps politically. It is agreed that Heinessen and its surrounding systems are to be given autonomy for the ownership of Iserlohn. They consider setting up a constitution for the Empire. Both Julian and Reinhard's staff prepare to leave to Phezzan.

Attenborough's fleet lines the entrance of the corridor with mines. He plans to snipe the Imperial fleet as they come through small holes within the minefield. The Imperial fleet creates 5 entry holes through the minefield to establish a bridgehead. Steinmetz is killed in battle. The Imperial fleet movements are sluggish within the corridor. Reuenthal orders the Imperial fleet to feign a retreat. The Yang fleet approaches the Reinhard's flagship but is unable to penetrate the battle line. Both sides withdraw.

The Free Planets Alliance fleet has conquered more than 200 star systems (50 million inhabitants) without fighting. In Iserlohn, vice-admiral Alex Cazellnu drafts a supply plan, but he is worried about such a heavy burden: for him, Reinhard clearly wants the Free Planets Alliance to exhaust its resources on behalf of the liberated planets. The supply fleet is destroyed by Kircheis because Fork didn't think such an attack was possible. Yang, fearing a scorched earth policy, convinces his fellow fleet commanders to ask for a withdrawal. Riots break out on many planets because of the food shortage and the looting of the soldiers. Fork experiences a case of hysterical blindness in the face of his plan's failure. In Phezzan, Rubinsky grants a new loan to the Free Planets Alliance to maintain the balance: he hopes to economically control both the Empire and the Alliance. October, 10, 796 S.C. / 487 I.C.: Reinhard orders to launch the counterattack.

Reinhard is displeased by Kempf's report and decides to dispatch Mittermeyer end Reuenthal Fleet; he thinks the best tacticts was to smash Geiesburg against Iserlohn and destroy both fortresses (Yang has the same idea). Imperial scout ships detect Yang's reinforcement fleet. Kempf plans to lure the Iserlohn Fleet out of the fortress by pretending to retreat, then strike and seal it in the fortress, which will allow him to attack the reinforcements. Julian Minci sees through his plan. Merkatz, leading the Iserlohn fleet, pretends to fall into the trap, thus the Imperial Fleet is attacked from behind when it engages Yang's fleet. Kempf finally decides to smash Geiesburg into Iserlohn, but the Alliance's fleet destroys the engines, and the damaged the fortress moves randomly, destroying many imperial ships, before blowing up. The Imperial Fleet falls back but, against Yang's order, some commanders decide to pursue the Imperial Fleet.

In late May of Space Calendar 801, New Imperial Calendar 3 a refugee ship chased by Imperial ships runs into the Julian fleet. The Julian fleet decides to engage the Imperial ships. Eventually both sides send reinforcements and the full number of ships for each fleet is present. The Imperial fleet includes 51,700 ships while the Julian fleet has 9,800 ships. Both fleets act cautiously rotate their front line forces. Reinhard collapses midway through the battle. A communications blackout results in frustration from the Imperial admirals. Poplan intercepts some communications betweet Mittermeyer's ship and Reinhard's flagship. The Julian fleet decides to board the Brunhilde with melee infantry.

Yang attacks the supply lines of the Imperial fleet successfully. Next, Yang defeats a fleet near a black hole. Reinhard's anger at these losses are reaching boiling point. Mittermeyer and Reuenthal realize that they will have to launch a large offensive versus Yang if they hope to win before morale and food drops to dangerous levels. Yang defeats another fleet by filling supply pods with helium, then igniting the pods when the Imperial fleet nears them for pick up. Yang's guerrilla warfare tactics leave the Imperial fleet with uncertainty on where Yang will appear next. An attack on Heinessen is vetoed by both the Imperial Admirals and Reinhard. The only remaining option is a full fleet encounter by using Reinhard as bait.

Wahlan orders his fleet to investigate after learning of fleet movements inside the Iserlohn corridor. On the Imperial side of the corridor, Julian approaches Imperial admiral Wagenseil's fleet. Using strike craft and a slow withdrawal strategy, Julian infuriates Wagenseil. The Wagenseil fleet is lured into range of the Iserlohn Thor hammer cannon and loses a large portion its ships. Wahlan's fleet tries to attack Iserlohn from the back before the Thor hammer recharges. Merkatz ambushes Wahlan's fleet from a blind spot while Julean approaches from around the fortress, executing a pincer formation. The Thor hammer fires two more times, causing massive damage to the pincered Wahlan fleet. Reinhard prepares for a counterattack from Phezzan, but is bedridden with a high fever.

Prime Minister Lebello visits Yang in prison. Yang realizes he will be used as a scapegoat by the Alliance to avoid Imperial intervention. Schenkopp and Attenborough reorganize Yang's subordinates. With the Rosen Ritter in full rebellion, the Alliance troops are no match for the difference in battle experience and morale. During the chaos, the Rosen Ritter kidnaps the Prime Minister. However, the Alliance military decides to sacrifice the PM and execute Yang early. Frederica and Schenkopp save Yang at the last moment, escaping with Yang's staff into the night.

On his way to Heinessen, Yang thinks about the current situation. The Alliance's disrespect for human rights, democracy and freedom on the pretense of the war is leading the nation toward its destruction; moreover, the failed invasion of the Empire and the civil war have drastically weakened the Alliance's military. In Heinessen, Yang is separated from his companions, Louis Mashengo and Frederica Greenhill. While Yang's personality and actions are questionned by the committee, Greenhill and Mashengo try to reach him, but any contact is denied. They go to Admiral Bucock for help, but are attacked by the P.K.C. (which appears to be related to the Earth Cult) and rescued by Bucock's staff. April 10, 798 S.C. / 489 I.C.: the Geiesburg Fortress enters the Iserlohn Corridor.

Terraists attack multiple critical infrastructure locations on Phezzan. Communications with High Admiral Kesler are not re established till later when Terraists storm Stehibalm Schloss, the provisional home for Hilde and Grünewald. Marika von Feuerbach, a servant to Hilde leads Kesler and his military police to Hilde and Grünewald before they are assassinated. Hilde is rushed to a hospital where she gives birth to the new prince of the Lohengramm dynasty. Kesler uses torture and truth serum on the Terraists, cleaning out all Terraist influence on Phezzan. Reinhard names his new son Alexander Siegfried von Lohengramm.

The Free Planets Alliance fleet are attacked: the 3rd, 7th and 12th fleets are destroyed and the 5th, 8th, 9th and 10th fleets are heavily damaged; only the 13th Fleet has managed to escape without taking too much damage. Admiral Lobos orders the fleets to regroup in the Amlitzer Starzone. Reinhard orders his admirals to regroup in the same area in order to destroy the remaining fleets. The Free Planets Alliance Fleet suffer further losses during the battle of Amlitzer Starzone (October, 15, 796 S.C. / 487 I.C.).

Reinhard is devastated at the death of Yang. Müller is sent as official Imperial envoy in condolences for Yang's death. Mittermeyer and Reuenthal discuss Yang's death and the new peace. Reinhard while sick, continues autocratic reforms. Reinhard is regretful of Silverberche's death. Hildegard, being in a military position is not able to cross over to domestic political advise. Reinhard realizes that outside of himself, Hildegard, and Silverberche, there is not anyone with skill in politics equal to his admirals in military affairs.

Susanna von Benemünde, a former favorite of the Emperor, wants to get rid of Annerose and win back the Emperor's love. She teams up with Flegel, who hopes that a scandal involving Annerose will lead to Reinhard's downfall. Annerose is abducted: she is to be killed and found with a supposed lover from the lower class. She is rescued by Kircheis, Reuenthal, Mittermeyer and Oberstein. Benemünde is forced to commit suicide. Flegel has been smart enough to leave no proof of his involvement, but Oberstein and Reinhard suspect him anyway.

As if to escape the feelings of his rival's death, Reinhard works industriously in administrative tasks. In the rain, Reinhard ponders the pact he made with Kircheis and Reuenthal during a storm. At that time, Reuenthal had asked Reinhard's help in freeing Mittermeyer from nobles using their influence to kill him. Mittermeyer had executed a noble born soldier for killing and looting. On Heinessen, Reuenthal does swift moves to clean out corrupt ex-alliance politicians and military industry owners. Reuenthal feels that cleaning out corruption helps justify his rule in Heinessen. Mittermeyer meets his wife Evangelin at the space port.

Thirty years ago, marquis Klopstock was exiled form the imperial court. He asks prince Braunschweig, the Emperor's son-in-law, to ask forgiveness on his behalf. Braunschweig invites him to his daughter's birthday party. Klopstock's real goal is to bring a bomb in order to kill the Emperor, who will be there. At the party, Reinhard clashes with baron Flegel. The bomb is taken away by accident and makes little damage. Klopstock commits suicide and all the incident is kept secret.

Yang is sent to Thernussen (Heinessen's second largest city) with his ward, Julian Minci, to attend a ceremony at the Military Academy. He meets Jessica Edwards, who is campaigning for the Peace Party candidate in an upcoming election. We learn that Yang, while being loyal to democracy, has no love for the current politicians. The P.K.C. sets a bomb in the Peace Party's headquarters, killing the candidate, but their plan backfires when Jessica, who is the new Peace Party candidate, wins a landslide victory.

In Odin (capital planet of the Galactic Empire), Reinhard is promoted to imperial admiral after his victory at Astarte. With his friend Siegfried Kircheis, he pays a visit to his elder sister Annerose, the Emperor's favorite. In a flashback, Kircheis remember how he and Reinhard became friends, how Annerose was taken away from her home to be the Emperor's favorite and how they came to hate the high nobles and the Goldenbaum dynasty.

January 1, 796 S.C. / 487 I.C.: in the Astarte star system, a 20 000 spaceships Imperial fleet under Reinhard von Lohengramm's command is about to be cornered by three Alliance fleets of 13 000 spaceships each. Against the advice of his subordinates, Reinhard decides to strike first in order to defeat each fleet before they can join. The Allied commanders, trusting the overall odds of 2 to 1, don't anticipate this and rebuff Yang Wen-li's advice to quickly regroup their forces.

Oberstein confronts Reinhard to choose a consort for bearing a heir. Reinhard releases Hildegard and her father from house arrest. Reuenthal reveals to Mittermeyer that his personal demons are effecting his lifestyle. At this time Reuenthal also gives up his ambition for power, realizing he can not exceed Reinhard. Müller launches his fleet from Odin towards Earth. Julian, Mashengo, and Poplan arrive on Earth and head to the Earth Cult holy temple.

Admiral Kessler, chief of the Military Police, informs Reinhard that two former members of the Lippstadt League (Landsberg and Schumacher) have arrived in Odin, and may be involved in some plot. Reinhard asks Hildegard for her advice: shes thinks they are in fact sent by Phezzan and will try to abduct someone, probably the young Emperor. later, she pays a visit to Annerose von Grünewald (Reinhard's elder sister) and persuades her to let Reinhard increase the security measures. Reinhard summons Boltik, the Commissioner of Phezzan, tells him he knows everything about their plan, and asks what is Phezzan's interest: Boltik answers that Phezzan expects to control the space communications and trade in an unified Empire. Reinhard agrees to act according to Rubinsky's plan, only if Phezzan grants a free passage through the Phezzan Corridor to the Imperial Fleet.

January, 798 S.C. / 489 I.C.: Admiral von Schaft, head of the Science and Technology Division, works out a plan to take Iserlohn back. The Geiesburg fortress is to become a mobile fortress by adding warp engines: its firepower is a match to Iserlohn's, so the Imperial fleet will be able to defeat the Iserlohn Fleet. The operation will be under Admiral Kempf's command, with Admiral Müller as second-in-command. In Phezzan, Rubinsky decides to support the plan and asks Kesselring to find a way to move Yang away from Iserlohn. Some of Mittermeyer and Reuenthal's background is revealed.

After the destruction of the 4th and 6th fleets, Reinhard's fleet engages the 2nd Fleet. When its commander is wounded, Yang takes command and manages to escape utter destruction. In Phezzan, Adrian Rubinsky, administrator of the planet, and Nikola Boltik, his main adviser, make comments on the battle and note that it won't change the strategic situation.

Kircheis arrives at Geiesburg. He has an argument with Reinhard about the handling of the Westerland events. Reinhard assumes full responsibility for Oberstein's actions. A message is sent from Odin: Lichtenlade is plotting to get rid of Reinhard. Reinhard receives some rebel commanders. Adalbert von Fahrenheit joins Reinhard's team. Ansbach comes in with Braunschweig's coffin, but takes out a weapon and aims at Reinhard...

The young Emperor passes through Phezzan into Alliance territory. The Alliance government declares that they will shelter the refugees while the nobles announce a government in exile. Merkatz is appointed as secretary of defense without his own consent. August, 20, 798 S.C. / 489 I.C.: Reinhard declares the government in exile kidnapped the young Emperor in an underhanded act of cowardice. The public within the Empire mobilizes in support of Reinhard's declaration of total war.

On Odin, Reinhard reviews the secret history of the past Emperors of the Empire. On Heinessen Yang is enjoying his private life. Lennenkanpt is uneasy with Yang's quiet life, being vigilant he increases surveillance. Fredrica decides to learn how to cook better for Yang, she consults Cazellnu's wife. During this period, both women realized they can trade information inside the food.

Reuenthal is arrested by the Imperial police under suspicion of overthrowing Reinhard. It is revealed that Lang, the head of the secret police initialed the investigation. Reuenthal is accused of harboring a woman of the exiled Lichtenlade family. Oberstein is suspicious of Lang's intentions. It is revealed that the woman is pregnant with Reuenthal's child. Reuenthal is granted a hearing from Reinhard that very afternoon. Reinhard and Reuenthal reminisce on the past. The Imperial officers direct their hatred toward Oberstein.

Julian ponders his next step. Julian speaks with Katerose around the Iserlohn park. The fleet in Iserlohn work hard and keep training for any future military conflicts. Julian considers a plan of pushing the Empire towards constitutional government. Boris Konev arrives with supplies from Heinessen. He points out that Trünicht is conspiring with Terraists. Frederica remembers the history of her relationship with Yang and lets go of regrets.

In Phezzan, Rubinsky explains his plans to a bishop of the Earth Cult. He will use his contacts in the Free Planets Alliance, such as chairman Trüniht, to make the Alliance crumble from inside, paving the way for an Imperial victory. Then, Reinhard is to be murdered. Kesselring is sent to the Alliance's commissioner in Phezzan, saying the financial support can continue only if the Alliance is a stable democracy, hinting that Yang is willing to seize power. In Iserlohn, Alex Cazellnu is concerned about Yang's safety: for the time being, his skills are needed, but he fears that Trüniht wants to dispose of him in the end. In Heinessen, Trüniht, who dislikes Yang's popularity, asks the Secretary of Defence, Negreponte, to form an inquiry committee about Yang's action during the coup.

Julian Minci asks Frederica Greenhill how Yang became the "Hero of El Facil": 9 years ago. The Free Planets Alliance fleet, led by Arthur Lynch, fled the approaching Imperial Fleet, leaving 3 million people behind; Yang, one of the few officers left, organized the evacuation while the Alliance Fleet was defeated. Meanwhile, in the Empire, Reinhard thinks a civil war is about to break out; in order to avoid an intervention form the Alliance, he decides to infiltrate Lynch in the Alliance to stage a military coup. The move is hidden behind an exchange of 2 million prisoners of war. End of 796 S.C. / 487 I.C.

Paul von Oberstein, chief of staff of the Iserlohn fleet, is in trouble. He saw through Yang's plan, but his commander didn't listen to him, and he fled before the destruction of the fleet. The three chiefs of the Imperial fleet resign, but want to make him responsible of the defeat. Oberstein meets Reinhard and explains how, like him, he hates the high nobles and the Goldenbaum dynasty, and offer his help. Reinhard agrees and obtains his pardon by advising the Emperor to refuse the chiefs' resignations.

Reinhard and his senior staff launch from Heinessen and head towards Iserlohn. On Phezzan, a terrorist bombing occurs during a celebration. Silverberche is killed while Oberstein and Lutz suffer minor injuries. The Imperial plan to attack Iserlohn is not postponed. On Heinessen, Andrew Fork is kidnapped by the Earth Cult. On the front lines, Fahrenheit and Bittenfeld kill time.

August, 22, 796 S.C. /487 I.C.: the invasion of the Empire has begun. Reinhard implements a scorched earth strategy: all food is taken from the frontier zone, so the "Liberation force" of the Free Planets Alliance will be forced to feed the inhabitants. Reinhard plans to attack the invading fleets when their supply lines will be overstretched. Commodore Ulrich Kesler carries out the orders but, in the process, has to face someone from his past.

A large memorial service by the former Alliance government turns into a bloody riot with around 5000 killed and the number of injured exceeding 50,000. Reuenthal looks for the instigators of the riot. A anonymous tip warns that Trüniht is responsible for the violence now spreading from the memorial service to all parts of Neue land territory. Reuenthal orders a blockade outside of Iserlohn. On Iserlohn, Julian and Katerose become closer. Meanwhile, Terraists plan to turn Reinhard into a tyrant by provoking Reuenthal to betray Reinhard. If Reinhard became a tyrant, it would increase public unrest and give Terraism as a religion a chance to gain mass appeal.

Julian is assigned to Phezzan by central command. Yang and his staff decide to assign Mashengo to be Julian's body guard. Yang shares with Julian his thoughts about the possibility of Phezzan allying with the Empire due to the power balance being shifted. Julian mentions the possibility of Phezzan allying with the Empire not because of realist means, but instead out of ideological or religious reasons. Julian agrees to be of use to Yang and go to Phezzan to spy on any developments. The Iserlohn staff say their goodbyes to Julian.

Yang is summoned to Heinessen, where the Secretary of Defence is holding an inquiry. This move shocks his staff because such a committee has no legal basis. In Phezzan, Kesselring enlists two former members of the Lippstadt League, Leopold Schumacher and Alfred von Landsberg to carry out a plan we know nothing about. March 13, 798 S.C. / 489 I.C.: the test of the warp drive of the Geiesburg fortress is a success. The fortress and its supporting fleet can now move to the Iserlohn Corridor and attack the Alliance's fortress.

Julian arrives on Phezzan. The next evening, he attends his welcome party. Julian spreads conjecture about a possible invasion of Phezzan from the Empire. Reinhart organizes his fleet for operation Ragnarok. Admiral Bucock tries to warn the Alliance National Defense Council about a possible Phezzan corridor attack, but is ignored. November, 20, 798 S.C. / 489 I.C.: Admiral Reuenthal leading an Imperial Fleet of 36,000 ships lays siege to Iserlohn. Carrying out the first part of Operation Ragnarok.

The Lippstadt League plans to draw Reinhard to Geiesburg in order to defeat him in a decisive battle. As a part of this plan, admiral Staaden has to lead a fleet to Odin in order to cut Reinhard's fleet from its base. Mittermeyer is sent to intercept Staaden, whose fleet is crushed during the battle of Altener and withdraws to the Rentenberg fortress. Reinhard decides to take the fortress, but the boarding parties are repelled by the garrison, led by admiral Ovlesser. An assault led by Mittermeyer and Reuenthal succeeds, and Ovlesser is taken prisoner. Reinhard wants to execute him, but Oberstein advises to send him back to Geiesburg. Ovlesser is released, but is executed by Braunschweig who thinks he was freed because he turned against him. Fear of treason spreads among the Lippstadt League.

Julian convinces Wahlan to escort him to Odin. The Imperial admirals discuss the issue of Lennenkanpt's capture and the unverified accusations against Yang. Oberstein argues that the subterfuge within Heinessen could be very advantageous to the Empire. The Admirals all reject Oberstein's conclusion and opportunism, preferring to investigate the plot for the truth. Yang's fleet heads towards Merkatz's base. During this trip, Yang considers the miscalculations leading up to his capture as well as the next steps needed. Reinhard formalizes his plan of moving the Imperial capital to Phezzan. August 13, 799 S.C. / 1 N.I.C.: Planet El Facil declares independence from the Empire and Alliance.

The Mittermeyer and Reuenthal Fleets meet the retreating Imperial fleet and destroy the Alliance's pursuing ships before falling back when the Iserlohn Fleet shows up. In Odin, Müller is forgiven by Reinhard. Reinhard tells Hildegard von Mariendorf that power should not be inherited, but seized. In Phezzan, Kesselring explains to Rubinsky that the Free Planets Alliance is on the verge of bankruptcy; they decide to go on with their plan. It is revealed that Kesselring is Rubinsky's illegitimate son. Back in Iserlohn, Yang shares with Julian Minci his thoughts about military strength and how it is often used against the citizen it was supposed to protect.

The Imperial forces head deeper into Alliance territory. Julian and friends arrive on El Facil. Julian passes off the Terraism data disk to Yang. Yang and stuff discuss the next step, namely the retaking of Iserlohn Fortress. The El Facil government is wary of Yang being outside of their field of control, thus they refuse to let Yang lead the next operation. Effectively Yang has become a bargaining ship for controlling the excesses of his subordinates. Yang speaks with Konev about the possibility of Phezzan's aid. December, 799 S.C. / 1 N.I.C.: The El Facil fleet, under Merkatz launches for Iserlohn. During the same time, the last of the Alliance fleet launches for their final sortie.

Yang decides to take Iserlohn by a ruse. The Rosen Ritter (Knights of the rose), a ground combat unit made of Imperial exiles, will pose as an imperial crew and infiltrate the fortress. Yang's staff is introduced: Murai, Patrichev, Fischer (a master of fleet maneuvers) and Frederica Greenhill, daughter of admiral Dwight Greenhill. The Iserlohn fleet is lured away from the fortress by decoys. When a damaged imperial spaceship asks for help, the commander of Iserlohn, who doesn't know where his fleet is due to radar jamming, authorizes it to dock...

Prince Brauschweig and marquis Littenheim team up to overthrow the young Emperor and get rid of Reinhard. Count Franz von Mariendorf wants to join the conspiracy, but his daughter, Hildegard persuade him not to do so because a new order is rising under Reinhard. She goes to Reinhard and offer her family's allegiance. The high nobles create the Lippstadt League, led by Braunschweig and Littenheim; admiral von Merkatz agrees (although reluctantly) to command their military forces. April, 6, 797 S.C. / 488 I.C.: Reinhard strikes first and manages to arrest many conspirators, but Brauschweig and Littenheim flee and regroup most of their forces in the Geiesburg Fortress.

January 1, 798 S.C. / 489 I.C.: Reinhard von Lohengramm is now Premier and Commander-in-chief of the imperial military. He implements many reforms for the welfare of the people. Meanwhile, an training sortie, under Dusty Attenborough's command, turns out to be Julian Minci's first battle as a fighter pilot. The Attenborough Fleet is on the verge to be crushed, but Yang Wen-li, with the help of Admiral Merkatz, goes out of Iserlohn with the whole fleet and saves the day (January, 16).

Admiral Bucock informs Julian that the alliance government is trying to divide Yang from his allies as a way of preventing any future powergrab by Yang. Reinhard discusses his plans on using the Phezzan corridor with his Admirals, calling the plan Operation Ragnarok. Over 1 million ships are planned to be in the fleet. Reinhart speaks with Oberstein and discuss the use and eventually the expendability of Boltik, current Commissioner of Phezzan. Oberstein creates a secret police with Lang as the leader. September 20, 798 S.C. / 489 I.C.: 8 month old Catherine succeeds the throne of the Empire as the new Empress.

Julian and friends leave Phezzan on a cargo ship. Julian tricks the captain of an Imperial destroyer and captures the destroyer. Reinhard organizes and briefs his fleet on the invasion plan. The Imperial fleet has a 3 to 1 fleet number advantage over the hodgepodge fleet of the Alliance. The Imperial and Alliance fleets are days away from a battle in the uninhabited Rantemario star system.